|
Real Property Law
Real property law is crucial in market economies; it provides the legal environment for a business to own, use, and sell land and buildings as well as to use them as collateral to obtain credit. Good property law is especially critical in transition economy countries; a good property law enables entrepreneurs to acquire land freely to produce goods and services in a secure ownership environment, which is a necessity for planning for the long term. A good property law must also be accompanied by an objective, standardized titling system.
Cambodia’s Constitution, enacted in 1993, marked the country’s transition from a socialist to a market-based economy. Consistent with this, the Constitution affirmed the right to private ownership of land (Article 44). Cambodia has since adopted an extensive (and still evolving) set of land laws that are conducive to commercial activity in land. In actual practice, however, land transactions are often subject to political interference and opacity that have dampened entrepreneurial investment.
Although foreign investors are urging the government to allow foreign ownership, and a debate on this matter is underway, Cambodian land law currently limits land ownership to Cambodian citizens. There are many de facto forms of foreign landholding, including leasing from Cambodian owners, indirect ownership through Cambodian companies, and acquisition of land concessions (which, unlike ownership, may be held directly by foreigners). Even with these devices, however, foreign landholding is more constrained and less secure than in full market-economy countries or than it should be for optimal future economic development in Cambodia.
Cambodia has never had a reliable, standardized system of land titling, but that is changing. An in-progress donor-assisted comprehensive long-term survey and titling project will ultimately cover much of the significant commercially usable land in Cambodia. However, even that is slowed by the significant number of title disputes, many of which involve political issues.
|
